Cayman Captive Forum Presentation 2013. Captive / Actuarial 101. Julie E. Robertson Partner. Joseph A. Herbers Managing Principal. Fiona J. Moseley President & Director.
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Captive / Actuarial 101
Joseph A. Herbers
Fiona J. Moseley
President & Director
" Everything you wanted to know and were afraid to ask… An introductory session to cover practical guidelines on legal, actuarial and regulatory matters during the formation and operational stages of a new captive."
But the world is more complicated
- Claims - Accounting
- Underwriting - Ratemaking
- Marketing - Reinsurance
- Legal - Systems/IT
Usually stated as % of either WP or EP
Single Parent Captive
Wholly owned insurance company established to insure/reinsure the risks of the single parent and/or its affiliates.
SINGLE PARENT NO AFFILIATES:
SINGLE PARENT CAPTIVE SERVING AFFILIATES:
Two or more owners form an insurance company to insure/reinsure risks of its owners (or their affiliates)
Cell Captive (aka Segregated Cell Captive, Sponsored Captive, Segregated Portfolio Company)
One insurance company with separate “cells,” each cell with a separate insurance program and possibly a shareholder.
Ownership of Voting Stock of
the Captive, Appoints Board
Preferred X Shares
Preferred Y Shares
Preferred Z Shares
Risk Retention Group
Similar in structure to a group captive, but formed in a U.S. state under authority of Liability Risk Retention Act. All insureds must be owners, and all owners must be insureds – only authorized to write liability risk.
RISK RETENTION GROUP
Domicile meeting requirements
Local director requirements
Ease of travel
Perception, particularly for nonprofits
Availability of home state as a domicile
Unique characteristics of the domicile
What’s most important:
Congratulations: You’re running an insurance company!
– who is driving the bus and from where?